What is due diligence?
Last updated
Due diligence is the investigation carried out before a decision such as an acquisition, an investment, a contract or a new supplier, to confirm the facts and find the risks. It usually means requesting and reviewing documents, asking questions, checking claims against evidence and recording what was found before anyone commits.
In more detail
The scope depends on the decision. Buying a company calls for financial, legal, tax, commercial and technical due diligence. Taking on a supplier needs checks on its finances, security and compliance. Banks and other regulated firms carry out customer due diligence to confirm who they are dealing with.
Most of the work is coordination: a long list of document requests, several reviewers, follow-up questions and a deadline. Keeping one list of requests, with an owner, a status and the evidence attached, makes it far easier to see what is still missing and to show later what was checked.
Example
Before signing a new payroll provider, a finance team asks for its security certifications, insurance certificate and data processing agreement. Legal reviews the contract, IT reviews the security questionnaire, and the finance lead records the findings and signs off the decision.
Due diligence in CheckFlow
In CheckFlow a due diligence checklist lists each request as a task with an owner, a due date and a File Upload field for the evidence. Reviewers record their findings in fields, a sign-off step halts the checklist until the decision is approved, and the activity feed shows what was checked and when.
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